IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v17y2024i18p4655-d1480346.html
   My bibliography  Save this article

Evolutionary Trends in Carbon Market Risk Research

Author

Listed:
  • Xinchen Liu

    (College of Economics and Management, Beijing Forestry University, Beijing 100083, China)

  • Xuanwei Ning

    (College of Public Economics and Management, Shanghai University of Finance and Economics, Shanghai 200433, China)

  • Chengliang Wu

    (College of Economics and Management, Beijing Forestry University, Beijing 100083, China)

  • Yang Zhang

    (College of Economics and Management, Beijing Forestry University, Beijing 100083, China)

Abstract

The carbon emissions trading market is an essential tool for addressing climate change. The carbon emissions trading market has a relatively short history, and the research and management of risks in this market require further development. This paper takes as its research object 1272 pieces of English literature studies published by international scholars and featured on the Web of Science between 2002 and 2024. It uses CiteSpace software to categorize changes in the trends related to carbon market risk research based on time, space, and keyword clustering mapping. The results reveal the following: (1) In terms of the timeline, the risk evolution of the international carbon market is divided into an embryonic period (2002–2007), a developmental period (2008–2018), and a prosperous period (2019–2024); (2) from the perspective of spatial distribution, carbon market risk research institutions are multipolar, with China, the United States, and the United Kingdom, among other countries, issuing more studies on the topic; these studies mainly emerge from universities and research institutions; and (3) in terms of research hotspots, they revolve around four disciplinary issues, namely, primary research related to carbon market risk, carbon market risk categories, carbon market risk measurement, and response programs.

Suggested Citation

  • Xinchen Liu & Xuanwei Ning & Chengliang Wu & Yang Zhang, 2024. "Evolutionary Trends in Carbon Market Risk Research," Energies, MDPI, vol. 17(18), pages 1-28, September.
    • Handle: RePEc:gam:jeners:v:17:y:2024:i:18:p:4655-:d:1480346
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/17/18/4655/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1996-1073/17/18/4655/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Marimoutou, Vêlayoudom & Soury, Manel, 2015. "Energy markets and CO2 emissions: Analysis by stochastic copula autoregressive model," Energy, Elsevier, vol. 88(C), pages 417-429.
    2. Yemshanov, Denys & McCarney, Geoffrey R. & Hauer, Grant & Luckert, M.K. (Marty) & Unterschultz, Jim & McKenney, Daniel W., 2015. "A real options-net present value approach to assessing land use change: A case study of afforestation in Canada," Forest Policy and Economics, Elsevier, vol. 50(C), pages 327-336.
    3. Balcılar, Mehmet & Demirer, Rıza & Hammoudeh, Shawkat & Nguyen, Duc Khuong, 2016. "Risk spillovers across the energy and carbon markets and hedging strategies for carbon risk," Energy Economics, Elsevier, vol. 54(C), pages 159-172.
    4. Feng, Zhen-Hua & Zou, Le-Le & Wei, Yi-Ming, 2011. "Carbon price volatility: Evidence from EU ETS," Applied Energy, Elsevier, vol. 88(3), pages 590-598, March.
    5. Xu Gong & Mengjie Li & Keqin Guan & Chuanwang Sun, 2023. "Climate change attention and carbon futures return prediction," Journal of Futures Markets, John Wiley & Sons, Ltd., vol. 43(9), pages 1261-1288, September.
    6. Wang, Xu & Zhang, Xiao-Bing & Zhu, Lei, 2019. "Imperfect market, emissions trading scheme, and technology adoption: A case study of an energy-intensive sector," Energy Economics, Elsevier, vol. 81(C), pages 142-158.
    7. Patton, Andrew J. & Ziegel, Johanna F. & Chen, Rui, 2019. "Dynamic semiparametric models for expected shortfall (and Value-at-Risk)," Journal of Econometrics, Elsevier, vol. 211(2), pages 388-413.
    8. Byun, Suk Joon & Cho, Hangjun, 2013. "Forecasting carbon futures volatility using GARCH models with energy volatilities," Energy Economics, Elsevier, vol. 40(C), pages 207-221.
    9. Kreuter, Urs P. & Harris, Heather G. & Matlock, Marty D. & Lacey, Ronald E., 2001. "Change in ecosystem service values in the San Antonio area, Texas," Ecological Economics, Elsevier, vol. 39(3), pages 333-346, December.
    10. Adediran, Idris A. & Swaray, Raymond, 2023. "Carbon trading amidst global uncertainty: The role of policy and geopolitical uncertainty," Economic Modelling, Elsevier, vol. 123(C).
    11. Costanza, Robert & d'Arge, Ralph & de Groot, Rudolf & Farber, Stephen & Grasso, Monica & Hannon, Bruce & Limburg, Karin & Naeem, Shahid & O'Neill, Robert V. & Paruelo, Jose, 1998. "The value of the world's ecosystem services and natural capital," Ecological Economics, Elsevier, vol. 25(1), pages 3-15, April.
    12. Wei, Yu & Wang, Yizhi & Vigne, Samuel A. & Ma, Zhenyu, 2023. "Alarming contagion effects: The dangerous ripple effect of extreme price spillovers across crude oil, carbon emission allowance, and agriculture futures markets," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 88(C).
    13. James Tee & Riccardo Scarpa & Dan Marsh & Graeme Guthrie, 2014. "Forest Valuation under the New Zealand Emissions Trading Scheme: A Real Options Binomial Tree with Stochastic Carbon and Timber Prices," Land Economics, University of Wisconsin Press, vol. 90(1), pages 44-60.
    14. Mensi, Walid & Hammoudeh, Shawkat & Shahzad, Syed Jawad Hussain & Shahbaz, Muhammad, 2017. "Modeling systemic risk and dependence structure between oil and stock markets using a variational mode decomposition-based copula method," Journal of Banking & Finance, Elsevier, vol. 75(C), pages 258-279.
    15. Sirish Kumar Gouda & Haritha Saranga, 2018. "Sustainable supply chains for supply chain sustainability: impact of sustainability efforts on supply chain risk," International Journal of Production Research, Taylor & Francis Journals, vol. 56(17), pages 5820-5835, September.
    16. Deeney, Peter & Cummins, Mark & Dowling, Michael & Smeaton, Alan F., 2016. "Influences from the European Parliament on EU emissions prices," Energy Policy, Elsevier, vol. 88(C), pages 561-572.
    17. Mo, Jianlei & Cui, Lianbiao & Duan, Hongbo, 2021. "Quantifying the implied risk for newly-built coal plant to become stranded asset by carbon pricing," Energy Economics, Elsevier, vol. 99(C).
    18. Duan, Kun & Liu, Yang & Yan, Cheng & Huang, Yingying, 2023. "Differences in carbon risk spillovers with green versus traditional assets: Evidence from a full distributional analysis," Energy Economics, Elsevier, vol. 127(PA).
    19. Goran Dominioni, 2022. "Pricing carbon effectively: a pathway for higher climate change ambition," Climate Policy, Taylor & Francis Journals, vol. 22(7), pages 897-905, August.
    20. Zhao, Lili & Wen, Fenghua, 2022. "Risk-return relationship and structural breaks: Evidence from China carbon market," International Review of Economics & Finance, Elsevier, vol. 77(C), pages 481-492.
    21. Lin, Boqiang & Chen, Yufang, 2019. "Dynamic linkages and spillover effects between CET market, coal market and stock market of new energy companies: A case of Beijing CET market in China," Energy, Elsevier, vol. 172(C), pages 1198-1210.
    22. Reboredo, Juan C. & Rivera-Castro, Miguel A. & Ugolini, Andrea, 2017. "Wavelet-based test of co-movement and causality between oil and renewable energy stock prices," Energy Economics, Elsevier, vol. 61(C), pages 241-252.
    23. Hsiao, Yu-Jen & Tsai, Wei-Che, 2018. "Financial literacy and participation in the derivatives markets," Journal of Banking & Finance, Elsevier, vol. 88(C), pages 15-29.
    24. Feng, Zhen-Hua & Wei, Yi-Ming & Wang, Kai, 2012. "Estimating risk for the carbon market via extreme value theory: An empirical analysis of the EU ETS," Applied Energy, Elsevier, vol. 99(C), pages 97-108.
    25. Yuling Wang & Jing Wang & Lijun Pei, 2021. "Pricing of American Carbon Emission Derivatives and Numerical Method under the Mixed Fractional Brownian Motion," Discrete Dynamics in Nature and Society, Hindawi, vol. 2021, pages 1-8, April.
    26. Demiralay, Sercan & Gencer, Hatice Gaye & Bayraci, Selcuk, 2022. "Carbon credit futures as an emerging asset: Hedging, diversification and downside risks," Energy Economics, Elsevier, vol. 113(C).
    27. Viteva, Svetlana & Veld-Merkoulova, Yulia V. & Campbell, Kevin, 2014. "The forecasting accuracy of implied volatility from ECX carbon options," Energy Economics, Elsevier, vol. 45(C), pages 475-484.
    28. Zhang, Chen & Yang, Yu & Yun, Po, 2020. "Risk measurement of international carbon market based on multiple risk factors heterogeneous dependence," Finance Research Letters, Elsevier, vol. 32(C).
    29. Cong, Ren & Lo, Alex Y., 2017. "Emission trading and carbon market performance in Shenzhen, China," Applied Energy, Elsevier, vol. 193(C), pages 414-425.
    30. Vêlayoudom Marimoutou & Manel Soury, 2015. "Energy Markets and CO2 Emissions: Analysis by Stochastic Copula Autoregressive Model," Working Papers halshs-01148746, HAL.
    31. Soliman, Alaa M. & Nasir, Muhammad Ali, 2019. "Association between the energy and emission prices: An analysis of EU emission trading system," Resources Policy, Elsevier, vol. 61(C), pages 369-374.
    32. Vêlayoudom Marimoutou & Manel Soury, 2015. "Energy Markets and CO2 Emissions: Analysis by Stochastic Copula Autoregressive Model," AMSE Working Papers 1520, Aix-Marseille School of Economics, France.
    33. Liu, Zhibin & Huang, Shan, 2021. "Carbon option price forecasting based on modified fractional Brownian motion optimized by GARCH model in carbon emission trading," The North American Journal of Economics and Finance, Elsevier, vol. 55(C).
    34. Chai, Shanglei & Zhou, P., 2018. "The Minimum-CVaR strategy with semi-parametric estimation in carbon market hedging problems," Energy Economics, Elsevier, vol. 76(C), pages 64-75.
    35. Ha, Le Thanh & Bouteska, Ahmed & Sharif, Taimur & Abedin, Mohammad Zoynul, 2024. "Dynamic interlinkages between carbon risk and volatility of green and renewable energy: A TVP-VAR analysis," Research in International Business and Finance, Elsevier, vol. 69(C).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mulin Sun & Yuhao Fu & Mingyao Sun & Run Huang & Yun Teng, 2025. "Study on Key Influencing Factors of Carbon Emissions from Farmland Resource Utilization in Northeast China Under the Background of Energy Conservation and Emission Reduction," Energies, MDPI, vol. 18(2), pages 1-22, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Man, Yuanyuan & Zhang, Sunpei & He, Yongda, 2024. "Dynamic risk spillover and hedging efficacy of China’s carbon-energy-finance markets: Economic policy uncertainty and investor sentiment non-linear causal effects," International Review of Economics & Finance, Elsevier, vol. 93(PA), pages 1397-1416.
    2. Chen, Huayi & Shi, Huai-Long & Zhou, Wei-Xing, 2024. "Carbon volatility connectedness and the role of external uncertainties: Evidence from China," Journal of Commodity Markets, Elsevier, vol. 33(C).
    3. Xiangjun Chen & Bo Yan, 2024. "Research on jumps and volatility in China’s carbon market," Economic Change and Restructuring, Springer, vol. 57(1), pages 1-43, February.
    4. Yi Yao & Lixin Tian & Guangxi Cao, 2022. "The Information Spillover among the Carbon Market, Energy Market, and Stock Market: A Case Study of China’s Pilot Carbon Markets," Sustainability, MDPI, vol. 14(8), pages 1-18, April.
    5. Lin, Boqiang & Chen, Yufang, 2019. "Dynamic linkages and spillover effects between CET market, coal market and stock market of new energy companies: A case of Beijing CET market in China," Energy, Elsevier, vol. 172(C), pages 1198-1210.
    6. Liu, Jianing & Man, Yuanyuan & Dong, Xiuliang, 2023. "Tail dependence and risk spillover effects between China's carbon market and energy markets," International Review of Economics & Finance, Elsevier, vol. 84(C), pages 553-567.
    7. Wu, Ruirui & Qin, Zhongfeng & Liu, Bing-Yue, 2022. "A systemic analysis of dynamic frequency spillovers among carbon emissions trading (CET), fossil energy and sectoral stock markets: Evidence from China," Energy, Elsevier, vol. 254(PA).
    8. Wen, Xiaoqian & Bouri, Elie & Roubaud, David, 2017. "Can energy commodity futures add to the value of carbon assets?," Economic Modelling, Elsevier, vol. 62(C), pages 194-206.
    9. Chun Jiang & Yi-Fan Wu & Xiao-Lin Li & Xin Li, 2020. "Time-frequency Connectedness between Coal Market Prices, New Energy Stock Prices and CO 2 Emissions Trading Prices in China," Sustainability, MDPI, vol. 12(7), pages 1-17, April.
    10. Wang, Yudong & Guo, Zhuangyue, 2018. "The dynamic spillover between carbon and energy markets: New evidence," Energy, Elsevier, vol. 149(C), pages 24-33.
    11. Gargallo, Pilar & Lample, Luis & Miguel, Jesús A. & Salvador, Manuel, 2024. "Sequential management of energy and low-carbon portfolios," Research in International Business and Finance, Elsevier, vol. 69(C).
    12. Demiralay, Sercan & Gencer, Hatice Gaye & Bayraci, Selcuk, 2022. "Carbon credit futures as an emerging asset: Hedging, diversification and downside risks," Energy Economics, Elsevier, vol. 113(C).
    13. Tan, Xueping & Sirichand, Kavita & Vivian, Andrew & Wang, Xinyu, 2020. "How connected is the carbon market to energy and financial markets? A systematic analysis of spillovers and dynamics," Energy Economics, Elsevier, vol. 90(C).
    14. Xiaohua Song & Wen Zhang & Zeqi Ge & Siqi Huang & Yamin Huang & Sijia Xiong, 2022. "A Study of the Influencing Factors on the Carbon Emission Trading Price in China Based on the Improved Gray Relational Analysis Model," Sustainability, MDPI, vol. 14(13), pages 1-27, June.
    15. Chai, Shanglei & Yang, Xiaoli & Zhang, Zhen & Abedin, Mohammad Zoynul & Lucey, Brian, 2022. "Regional imbalances of market efficiency in China’s pilot emission trading schemes (ETS): A multifractal perspective," Research in International Business and Finance, Elsevier, vol. 63(C).
    16. Zhou, Wei & Chen, Yan & Chen, Jin, 2022. "Risk spread in multiple energy markets: Extreme volatility spillover network analysis before and during the COVID-19 pandemic," Energy, Elsevier, vol. 256(C).
    17. Pilar Gargallo & Luis Lample & Jesús A. Miguel & Manuel Salvador, 2021. "Co-Movements between Eu Ets and the Energy Markets: A Var-Dcc-Garch Approach," Mathematics, MDPI, vol. 9(15), pages 1-36, July.
    18. Cifuentes-Faura, Javier & Mohammed, Kamel Si & Alofaysan, Hind, 2024. "The connectedness and structural changes among green and conventional energy markets with CO2 emissions in the United States," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 80-94.
    19. Chang, Kai & Zhang, Chao, 2018. "Asymmetric dependence structure between emissions allowances and wholesale diesel/gasoline prices in emerging China's emissions trading scheme pilots," Energy, Elsevier, vol. 164(C), pages 124-136.
    20. Tan, Xue-Ping & Wang, Xin-Yu, 2017. "Dependence changes between the carbon price and its fundamentals: A quantile regression approach," Applied Energy, Elsevier, vol. 190(C), pages 306-325.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jeners:v:17:y:2024:i:18:p:4655-:d:1480346. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.